Granada boss told to watch his back

GRANADA boss Charles Allen may yet fall victim to the shareholder revolt that last week dashed Carlton chairman Michael Green's ambition to run the merged ITV companies.

The fund manager that led the campaign to stop Green becoming the chairman of a merged ITV has made it clear the new chief should have free rein. This includes the right to axe Allen, who has been earmarked as chief executive, if he thought fit.

Fidelity Investments' Anthony Bolton said: 'We need a new chairman who can come in, have a clean-brush approach to the structure and strategy of the company. And he must have no baggage from the past.'

Fidelity is set to be the largest shareholder in the new ITV.

Bolton also said shareholders - who have long had reservations about both men - singled out Green over Allen because he was the merged group's designated chairman. They decided removing both men would threaten the still-to-be completed merger.

Bolton said: 'If Charles Allen had been chairman and Michael Green would have been chief executive, Allen would have had to go.'

Both comments suggest Allen will - at the very least - be on a short leash when he takes over the new company early next year.

Some have even suggested he will have to deliver substantially more than the £55m savings already promised from the merger if he is to survive.

He is also expected to exchange his current two-year contract, which may entitle him to a £2m-plus pay- off, with a six-month notice period.

A replacement for Green has not yet been found. But it is thought Sir Brian Pitman, former chairman of Lloyds TSB and senior non-executive director at Carlton, will take over as 'interim chairman'. He is expected to commission headhunters and start the recruitment process.

Fidelity has already suggested former European head of CSFB John Nelson as chairman. Other candidates include ex-Vodafone boss Sir Christopher Gent.